At least seven people have died during an attack on a casino and a police station in a Kenyan holiday resort.

Police said a 50-strong gang of bare-chested youths armed with machetes and other crude weapons gathered near the building in the town of Malindi, an upmarket Indian Ocean resort popular with wealthy westerners .

Casino staff locked the entrance and the group attacked and killed a policeman outside.

The gang moved on to a local police station and attacked security officials. Six of the assailants were shot dead by police, authorities said.

"The group stood at the roadside for a few minutes. I heard gunshots shortly after seeing them," said Justin Kaingu, a night security guard.

Four gang members who later returned to the scene to collect the bodies of their fellow attackers were arrested.

Costal police chief Aggrey Adoli said authorities believed the gang was part of a separatist group called the Mombasa Republican Council (MRC).

MRC fights for an independent coastal state in southern Kenya and has been involved in previous violence.

Police blamed MRC militants for the killing of 19 people in two separate attacks on the day of Kenya's presidential election in Mombasa and Kilifi.